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Statistics illustrate war on middle class

President Bush recently addressed a dinner group of wealthy campaign contributors by congratulating them as the "haves" and the "have mores."

The New York Times on Nov. 19 pointed out that the top 1 percent of income earners in 2004 had an average income of $940,441 -- up 57 percent from 1990. And that was after adjusting for inflation.

The bottom 90 percent, with an average income of $28,355, has seen a 2 percent inflation-adjusted increase in income during the same 14-year period.

Against the backdrop of this statistic, it's not surprising to learn that CNN's Lou Dobbs has written the book "War on the Middle Class."

Thom Hartmann has added to the genre with his book, "Screwed -- the Undeclared War Against the Middle Class -- and What We Can Do About It." The latter is a hard-hitting Berrett-Koehler publication that should be required reading for every high school social studies student.

Its strength lies with the long historical perspective that traces back to the founding fathers and the arguments that led to a country with a strong middle class -- a deliberate and successful governing structure that frustrated the efforts of those who had hoped to rule as landed gentry.

Today, both of these books point out that a "corporatocracy" has seized control of some of the most sacred aspects of our democracy starting with electronic voting machines.

There are three companies that own the electronic voting business. One is controlled by a family that wants to substitute the bible for the constitution. Another is owned and operated by key leaders of the Ohio Republican party, and the third is owned by Venezuelan and Saudi interests.

A majority of U.S. congressmen endorsed a bill to require backup paper ballots, but congressional leadership refused to allow the bill to be submitted for a vote.

Computer experts say these machines all can all be hacked, and there is evidence that this has happened in a few key instances. In 2004, for example, Saxby Chambliss, who went on to end meat inspection as we know it, defeated Sen. Max Cleland, the legless Vietnam veteran, with computerized, nonverifiable results that defied all poll results by wide margins.

Next up was the Social Security system and the effort to make the case that this masterwork of a government program was broken. The solution was to break it further and heap a windfall of profit on financial institutions, which, as a group, have had to pay billions in sanctions for illegal behavior over the past 10 years.

Their plan for privatization included an asset charge of 0.3 percent to replace what currently costs just 0.03 percent. I can see those mutual fund managers saying, "Let's just move the decimal point one digit to the left and we'll make a 90 percent profit."

Henry Paulson, our new treasury secretary, pointed out in the latest Fortune interview that real wage growth for the past year has been 2.5 percent for the average worker. A 2.5 percent increase on top of the 2 percent for a total of 4.5 percent over 16 years since 1990 sounds a little paltry to me.

I spent a day touring a friend's sprawling multisite manufacturing facility recently and was reminded of how hard people work physically when they actually make things.

These are the folks who average about $31,000 (today's median income in California). Here in the Bay Area, most of us sit in cubicles staring at computer screens. We forget that companies like this exist, but the people who work in them are the bedrock of our society. They deserve to be well-educated with a safety net of a health plan and a retirement plan.

Books about the War Against the Middle Class spell out the extent to which we are failing this subset of society, and on the part of at least some short-sighted Americans, the effort is deliberate.

Adding one cent to the price of a pair of flip flops at Wal-Mart, or a half percent rise in prices generally, is all it would take to add a nation of uninsured citizens to something like Medicare.

Of the 35 industrialized nations, we are alone in our failure to offer universal health care. Meanwhile, the top 0.1 percent of Americans have an average income of $4,506,291, according to 2004 figures. These millionaires next door have had an 85 percent inflation -- adjusted increase in income over the past 14 years. These are the "have mores" that President Bush was courting, and they represent the high end of the widening wealth gap that has become the growing concern of both Henry Paulson and Fed Chief Ben Bernanke.

These new books on the subject offer what amount to shopping lists of reasonable solutions.

In Congress and in senior administrative positions, finally, we appear to have people who care. The ultimate solution may be a worldwide variation of the Henry Ford doctrine whereby everyone is paid enough to be able to afford a "a car in every garage and a chicken in every pot." Workers of the world, unite! We're all in for a struggle.

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